David Bach, a U.S. personal finance author, popularized the latte factor in his books (starting with The Automatic Millionaire in2004). He calculated that you could retire rich if you gave up your daily coffee habit.

While O’Leary never uses Bach’s phrase, he advises readers to calculate and save the money paid for coffee, cigarettes, magazines and lunches.

He calls this Ghost Money, which he defines as “dead money, money wasted on stupid things, money that should have been invested instead.”

He gives a few examples. With a $6 a week coffee habit (two purchases at $3 each), you can end up $3,900 richer over 10 years if you give it up — assuming you earn four per cent compound interest on your money.

Then, he adds in two magazines a month at $10, lunch once a week at $10 and one pack of cigarettes a week at $10. By sacrificing this other spending, you’ll be ahead by $18,400 over a decade.

“I look at that total and actually feel sad about the loss. Ghost Money is a sad thing. If this looks familiar to you and you can see in this your own poor spending habits, I hope the loss is haunting you. It should be,” he writes.

To increase the guilt, he inflates the numbers. Now you give up spending $12 a week for coffee, $8 a week for magazines, $200 a month for lunch and $10 a day for cigarettes over 20 years (instead of 10 years).

Moreover, you earn a six per cent compound interest rate on your money.

“A grand total of $276,420 in Ghost Money. Gone,” O’Leary exclaims about the big fortune lost by a big unconscious spender.

“Instead of putting that money into an account that accrued interest, this person bought People every week. Instead of saving for retirement, he or she enjoyed half-caf mochaccinos many mornings.”

Such remarks are full of contempt for average Canadians. How many people spend such large amounts on small purchases? And why not mention the vast sums wasted on lottery tickets?

Here’s a coincidence. I read another book over the holidays that took aim at money experts, such as Bach and O’Leary, who try to make you feel guilty about your daily purchases and your lost retirement nest egg.

• It’s the combination of high spending with sudden illness, job loss, divorce or accidents, leading to high unforeseen expenses.

• Household income has been stagnant for years. Instead of blaming individuals for not saving enough, we should be attacking the causes of our economic problems through social action.

“There is no personal finance or investment scheme that can fully protect us from downward spirals or plain old ill luck,” writes Olen, who admits she supported the Occupy movement.

“For that we need family, friends and, finally, the government, the back-step enforcer of everything from the rule of law to insurer of last resort.”

I’m sure O’Leary would bite her head off if she appeared on his TV show. But I found her book a fun and fascinating look at the well-meaning but often nonsensical dispensers of personal finance advice.

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